Suze Orman will offer a low-cost prepaid debit card with free credit bureau reports.
Second, the card will offer free credit bureau reports from TransUnion. A credit bureau report is not a FICO score. The Suze Orman Approved Card will not reveal credit scores to its card holders, either. It will give users a good sense of how well they are doing to improve their credit.
Orman is dead-on about the importance of these scores. Credit scores influence job applications, car insurance premiums, and the likelihood of needing to put down a deposit to get your utilities hooked up. The credit score is a gatekeeper to opportunity.
Lots of people have been trying to connect credit reporting to the prepaid platform. PRBC was the first serious effort. Although PRBC ran into some troubles, they were largely a product of internal management issues. Today, that PRBC data is being used by a company whose mission is not oriented toward helping consumers, but instead the small businesses that want non-traditional credit data in order to sell goods to people with poor credit. Even though PRBC did not work, it is the wrong conclusion to think that prepaid cannot do something for improving the credit of its users. I think that prepaid needs to give people a shot at getting back into branch banking. Until prepaid can evidence when people are paying their bills, then this never going to happen. It is nothing but good news that Suze Orman is putting her energy (and her money) toward the problem, everyone stands to benefit.
Bancorp Bank issues the card.
Another interesting function is its active use of text messaging. With most cards, customers send a text to the bank to request information. The Approved Card is different. It sends a text to the consumer with every single transaction.
Since Bancorp is a small bank, the card offers free bill pay.
If a customer has enabled their card with direct deposit, then all ATM transactions through the AllPoint network are free. This far exceeds the one free ATM visit per month standard set by the Federal Reserve.
Suze Orman and prepaid do seem like a natural match. Suze does not think much of paying for things on credit. In her mind, if you need to borrow than you probably cannot afford it. Indeed, the first step in the Suze Orman financial makeover is to get rid of all of your credit card debt. As long as prepaid can shirk off the ongoing efforts of lenders to put credit back on to prepaid, then the fit is perfect.
Lately she has even soured on the prospect of homeownership. The message is still the same - if you cannot afford it then you cannot buy it. She wants people to add forty percent to their PITI when they consider buying a home, because that is the likely cost for routine maintenance.
Sometimes Suze can sound like a bit of a scold. That is alright. We probably should have had more credit scolds a few years ago. At least she is an equal opportunity scold. She feels that borrowing money is a mistake for many people. She doesn't limit her critique to the borrower side of the equation, though. She will not carry water for banks that are in trouble with foreclosures because they played fast with traditional underwriting rules a few years ago, either. "I do not have a problem with people walking way if they honest-to-God cannot afford it," she says. "And I don't have a problem with them walking away if they're more than 50 percent underwater. I just don't. " She is handing out tough medicine for everyone: have integrity or pay the price.
In my opinion, the Approved Card deserves to be ranked at or near the top of all prepaid debit cards.